Arizona to Stop Penalizing Residents for Renting Out Homes on Airbnb

By May 17, 2016Economy

Despite efforts to regulate it into nonexistence, it is safe to say that the sharing economy is here to stay. Even when local governments have done their best to attempt to pass excessive regulations, somehow, the sharing economy have been able to assert its right to exist.

Currently, New York City hotel moguls have noticed a significant decrease in revenue thanks to the popularity of homesharing companies, like Airbnb. As a result, hotels have had to lower their rates within the city limits in order to compete with Airbnb listings.

Though this might not please those who have stake in the local hotel industry, the consumers have been the real winners when it comes to having more affordable options when visiting the Big Apple, a city known for its extravagant prices. Though New York City hotel giants are pushing for more regulation in the homesharing market, there has yet to be any move on the part of local legislatures.

See Also: In The Sharing Economy, The Consumers Are The Real Winner

On the opposite side of the country, Arizona has taken a step in the right direction towards allowing homeowners to do what they want with their own property.  Last Thursday, Arizona Governor Doug Ducey signed Senate Bill 1350, effectively prohibiting local governments from penalizing property owners who choose to rent out their homes as vacation rentals.

The bill comes as a response to the cities of Jerome, Sedona, and Scottsdale having either banned or placed extreme restrictions on the ability to use your home as a vacation rental. The bill, which was sponsored by Senator Debbie Lesko, received bipartisan support and is the first bill of its kind in the entire country.

“This law is a huge win for property owners statewide. Gone are the days when you could face jail time and thousands in fines for renting out your house to tourists,” said Christina Sandefur, the executive vice president of the Goldwater Institute.

At the center of the Arizona debate over homesharing is resident Glenn Odegard. Odegard had purchased a dilapidated home with the distinct purpose of turning it into a vacation rental. After going through the proper channels and receiving all the necessary permits needed to restore the historic home, and even obtaining a business permit to use the home as a rental, city officials changed their minds, and said that Odegard was no longer allowed to use the home as a vacation rental. Unfortunately for Odegard, this was after he had spent hundreds of thousands of dollars restoring the home.

Though Arizona’s law is definitely a giant stride in the direction of protecting property rights, thelaw has a few shortcomings. The law specifically deals with homesharing and making a profit by renting property that you already own. However, it does not protect other industries. If I am a talented knitter who would like to hire one or two employees to help me knit scarves, which will then be sold on sites like Etsy, it would still be illegal for me to do so under Arizona’s new law.

Carving out a niche in current zoning laws to allow property owners to rent out space in their homes is excellent, but it does neglect to fully protect property and the right of property owners to do as they please on said property.

Ideally, there would be no laws barring individuals from supplementing their income by being allowed to operate small businesses out of their homes. For the time being, only homesharing is specifically granted this permission under Arizona’s new law.

Though Arizona’s new law is definitely cause for celebration, until property owners have the right to fully exercise dominion over their own property, the battle over property rights will wage on.

Author Brittany Hunter

Brittany Hunter is a Staff Contributor at Generation Opportunity.

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